When the state of California raised the sales tax by another 1% on April 1, 2009 I was pretty pissed. What kind of government expects their residents to pay a whopping 10% tax on everything they buy? Pedro doesn’t want to pay $200 in taxes on his $2,000 60-inch LCD TV. Nancy shouldn’t have to pay $300 more on her $3,000 diamond encrusted bracelet. And I certainly don’t want to spend $5,200 in taxes on a handsome $52,000 BMW! That’s just ridiculous!
We the people of California deserve our luxury items just like every other parrot-brained consumer in America. Who’s to dictate what we can and can’t waste our hard earned money on? Certainly not some bureaucrat in Sacramento counting all his money under the table, no way!
GOVERNMENT WANTS YOU TO SAVE WHILE THEY SPEND
I was angry about the mismanaged state of our budget and so I went on strike. I cut down my purchases so drastically that by April, 2010, one year after the sales tax raise, I literally had over $20,000 in extra spending money in the bank. You see, I figure I spend about $20,000 a year for the past 5 years on stuff. This stuff includes automobiles, watches, shoes, clothing, musical instruments, computers and so forth.
I could accept paying 8.5%, or $1,700 in taxes on $20,000 a year in stuff. But, I drew the line at 10% and wasn’t willing to support government waste, greed, and mismanagement by contributing $2,000 a year in sales tax. I’d rather just laze around and demand government help than contribute to a lost cause so I stopped consuming in California.
The $1,700 in California sales taxes I paid on average for the past 5 years literally declined by 95% last year. Whenever there is something to buy in California, I think about the 10% sales tax and get sick to my stomach. I end up putting the item back on the shelf and walk away.
THANK YOU CALIFORNIA
I just want to formally thank California for jacking up taxes so much. It’s great that whether one is poor or rich, they are still going to have to pay the same 10% sales tax on basic necessities. So thoughtful of you guys! Without government mismanagement and corruption, I wouldn’t be $20,000 richer today. I would have spent merrily all along, not thinking about where the tax revenue is going.
So thanks again guys for helping me save a boatload of money over the past year. You guys might as well increase the sales tax to 30% for all I care. You’ll really crush your tax revenue by causing a halt in spending. Not only that, you’ll just have people move out of California. Washington, here I come!
Assuming Trump doesn’t lower them. This existing tier doesn’t reward work ethic. It punishes!
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I pay more in bottled water costs than I would in taxes. I have to buy the water, because the pipes in my metro area have only had patchwork since the Great Depression, and the water is periodically polluted with, among other things, lead and raw sewage.
So for the love of all that is holy, every time I hear so much whining about taxes this and taxes that, I really wish people would remember that taxes also buy us stuff. And if you’re not buying in to the cheaper economies of scale available through things like municipal water, you might be paying even more in other ways. (And before the Randians chime in, no, I do not believe the free market can or will provide a cheaper, more effective solution to a product that is necessary for basic human survival).
Hey Sam,
Great point about the demotivating effects of increased taxation. I do think that there will be a significant number of intelligent middle-upper class people that will just decide to ‘coast’ once taxes hit a certain threshold. It’s only logical since more effort will only put more money into the governments hands to waste.
California has a long way to go to recover from the mess they’ve gotten into and I definitely don’t plan on funding that recovery any more than I have to.
My best,
-Josh
Unfortunately, many are not as wise as you are, and will continue to spend and be raped by the taxes. Myself, I left California in the 90’s. The cost of living was too much for the lifestyle my husband and I wanted for ourselves and our family. Subsequently, we have lived very well in various less expensive areas and amassed a substantial retirment fund tin the process.
My town just raised taxes to 10%. I drive to the next town to buy anything.
You’re a stud! $20,000 in a year is awesome! Props to you. I hope to save that this year but the problem is it will go to the government to pay off loans!
Ha, not a stud, just a guy who doesn’t agree with forever rising taxes! Went ahead and went on strike.
Cheers
No worries with people stop working Sam. I pay 45% on my next dollar and I keep working for more ;-) hahaha!
I would feel better with a base taxe of 20% and a luxury taxe on goods. At least, I wouldn’t have the feeling that I pay for everybody all the time ;-). More thoughts on taxes on today’s post (great coincidence, isn’t?)
You should come to America! We LOVE people like you who LOVE to work more to pay 45% tax to help subsidize the 47% o Americans who don’t pay anything. Great attitude mate!
Wait, I’m confused? Obama keeps telling us that raising taxes is good for us and reminds us about how well the economy did under the Clinton tax rates. Surely, the government can make better use out of our funds than private industry and citizens, no?
no.
Canada is starting to look good. I think the VAT is 17%, plus the income taxes that are similar to ours. However, that cost includes all the health care. What do you get for 10% in California? Probably not that much service.
More insidious about CA is the aggressiveness of the state tax authority. I remember reading a story of a resident who bought a very expensive car. Because government knows your income and apparently can tie that purchase to it, they went after her to find out how she could afford such an expensive car. (At is turns out, she got a big lump sum from an insurance payout on her wrecked car – which she turned over as a down payment on the new car). Sick.
For 10%, we get some damn good sunshine and awesome nature!
What about the stealth tax in the debasement of the USD$.
Nobody complains about the dollar losing value or “real” inflation which is a tax that punishes hard working savers regardless of state…..
Sadly most people think this is a good thing because it “helps exports” which is a joke.
I’m a saver, and I don’t mind the weak dollar. There is no real inflation and rates will stay low for a looong time.
I am buying real estate now though. No brainer imo with rental yields at 7-8%.
I guess my experience makes me think you sound like a whiner. I paid 9.75% where I lived in the states and now I pay 15% in New Zealand.
I suppose you could always move to a state without sales tax. Try Oregon. It’s all California transplants so you’ll fit right in. ;)
Thanks for calling me a whiner. A whiner is someone who doesn’t do anything about their displeasure. I shutdown $20,000 worth of spending in protest of the increased tax.
Oh, don’t be sensitive. ;P I’m probably more of a whiner than you are over all. I hope your protest makes you happy. :)